John Rallo, Who Bribed Steve Stenger, Sentenced to 17 Months

Mar 5, 2020 at 1:27 pm
John Rallo leaves court in May 2019. - DOYLE MURPHY
John Rallo leaves court in May 2019.

When John "Johnny Roller" Rallo first met Steve Stenger in 2014, he told the future St. Louis County executive he was sick of giving politicians money and getting nothing in return.

All that changed with the crooked entrepreneur's introduction to the corrupt politician at a south county steakhouse. In the years since, Rallo's generous campaign donations were rewarded with county contracts he had no business winning, easy access to the most-powerful figures in county politics and, finally, a federal prison sentence of a year and five months.

Rallo, 54, pleaded guilty in July to three counts of honest services mail fraud/bribery and was sentenced today during a hearing that was packed with friends, family and reporters.

"I offer my wholehearted and sincere apologies to all who were harmed," Rallo said in court, reading from a prepared statement.

He was once a key operator in the pay-to-play scheme that toppled Stenger and members of his inner circle in 2019. The case unfolded in stunning fashion last spring when the now-former county executive was indicted, resigned and swiftly pleaded guilty to the same charges as Rallo. He is now serving a little more than two years at a federal prison in Yankton, South Dakota.

The case also brought down Stenger's Chief of Staff Bill Miller (fifteen months in prison) and former county economic development CEO Sheila Sweeney (probation) upending county government.

Of the four indicted in the case, only Rallo was still waiting to be sentenced. A former nightclub owner, he had opened an insurance business called Cardinal Creative Insurance and hoped to buy his way past the bidding process for a contract for county employees' benefits.

His pitch began at that first meeting in 2014 at Sam's Steakhouse.

"The relationship was corrupt from the beginning ..." Assistant U.S. Attorney Hal Goldsmith wrote in a sentencing memo.

Stenger, then a councilman, was running for county executive and was eager to help, given that Rallo was offering to become a loyal donor to his campaign. Rallo paid for dinner and slipped Stenger a $5,000 check. Over the next four years, the jet-setting businessman would wine and dine the brash politician repeatedly, lining up other donors and arranging fundraisers.

For his part, Stenger repeatedly tried to guide the benefits contract to Rallo but was stymied by county employees who insisted on routing Cardinal Creative Insurance's pitch through the normal bid process. To appease his financial benefactor, Stenger and his cronies came up with other illicit money makers, steering a pair of industrial properties to Rallo and awarding him a bizarre consulting gig, paid through the Port Authority.

Rallo created a new consulting company solely for that contract, offering to bring in his buddy, former talk show host and payday loan pitchman Montel Williams to help boost the county's post-Ferguson image.

The six-month $100,000 renewable contract was worth less than the $350,000 Rallo wanted, but he took it anyway, lazily filing made-up progress reports that were so thin that Sweeney, who ran the Port Authority, had to work with him to make them appear at least passably legit.

In court, defense attorney John Rogers pleaded for lenience for Rallo. His client has five kids and wide support from family and people in the community. Rogers noted the humiliation the case and media attention had caused his family. People avoided Rallo's parents at their church, his kids were upset by what they read on the internet and Rallo had retreated from the shame to Utah, where he and his family live in relative isolation, Rogers said in court.

 "I know these [consequence] pale to what other people suffer, but they are real and relevant," Rogers said.

U.S. District Judge Richard Webber pointed out this wasn't a case of a one-time mistake by a businessman who found himself in the midst of a corrupt situation. Webber cited that first meeting in which Rallo told Stenger he was sick of paying politicians for no benefit. Rallo's push for illegal deals continued steadily for years.

In the case laid out by federal prosecutors, Rallo was caught in texts badgering Stenger to make deals for him in between fundraisers. The court documents describe breakfasts at the Ritz Carlton, dinners at 801 Chophouse and drinks at Cafe Napoli. All the while, Rallo was playing the role of the money man, the deep-pocketed entrepreneur looking for a return in taxpayer-funded contracts.

As part of sentence, he'll have to dip into his pockets one more time to help pay $130,000 in restitution. One difference: This time, Stenger and Sweeney will have to split the bill with him, sharing the restitution among the three.

We welcome tips and feedback. Email the author at [email protected] or follow on Twitter at @DoyleMurphy.
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